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8 of 9 people found the following review helpful:
5.0 out of 5 stars
There are a few things you MUST do. Everything else you can ignore. This book will teach you how to do what matters, September 6, 2007
If Warren Buffett and Jack Welch both recommend a book, I don't need any additional incentives to buy it. Doing What Matters is a well written book by James M. Kilts, the former CEO of Gillette and prior to that the CEO of Nabisco & Kraft.
The book is divided into four sections:
Section I Fundamentals, attitudes, and people matter
Section II Leadership matters
Section III The future matters
Section IV Doing the right things matter
In the first section he talks about his arrival at Gillette, after having been given the blessing by Warren Buffett, who at that time owned 10% of the Gillette stock. He talks about the tough decisions that had to be made right from the start. Gillette had been missing the earnings estimates for FIFTEEN consecutive quarters and had taken a beating with Wall Street. What should they do with Duracell, which had been bought at a premium just four years ago and had been loosing market share ever since? There were three options on the table and he goes through the process of decision making. He also immediately halted the statements of short term estimates and forecasting to analysts and investors.
Kilts warns about the Yo-Yo effect that plagues companies that uncompromisingly set out to be number one in their market. He writes that "Setting the objective of being number one year in and year out virtually assures the opposite."
He also covers, on this section, a focus on the fundamentals and on keeping it simple. "Articulate three to five concepts that will drive your performance; the fewer the better, but definitely don't exceed five." He goes on to advice that one should always stick to these fundamentals and be as consistent as possible.
He also covers the need to see things as they are, echoing, what Jack Welch calls "Facing Reality". Kilts writes, "It is the ability to hold a mirror to your organization - whether that's just a few people in a small office or thousands of workers in hundreds of global locations - and the willingness to view the reflection with total honesty."
He continues with the importance of enthusiasm as something that has to be sustained over time. "Why wouldn't a company want to approach any important external audience with all the excitement of Billy Graham on a crusade?" Good point!
The action section is very informative; I specially liked the snake killer metaphor.
Section II is the one that deals more with leadership issues. He sees the role of a leader as a facilitator and considers "one of the most important responsibilities of a leader is to create the right environment and then give the employees development opportunities that enable them to realize their full potential."
He later discusses strategic planning and one of the common themes of his tenure at Gillette had to be his dogged determination to ZOG (Zero Overhead Growth). Another thing that he immediately corrected after becoming CEO of Gillette was their performance grading. It turned out that, although, the company was missing all their quarterly estimates, over 60% of managers rated above average or outstanding on their grading system. This of course, created a counterproductive system of rewards and incentives. Going back to ZOG, there is an interesting conversation that took place during a meeting. Kilts asked the division heads, how many of them thought that costs were very high in the company. All of them raised their hands in agreement. However, when he asked how many thought that costs were high in their particular departments, none of the hands went up. This is often the case when it comes to making tough choices; most see the problem as foreign to their department thus crippling the chance of a solution.
Since leadership has to do with the future it is appropriate that the third section deals with this topic precisely. In this section the book covers from road maps, instilling a sense of purpose and urgency in the organization to the mastery of incremental innovation. Of course, the end result of all this is the formation of a new culture that sees the big picture and works in unity to achieve it.
In the final section he covers his relationship with the media and politicians; his relationships with mentors and the things that matter the most to him. In short, the last section is Mr. Kilts reflecting on his stellar career.
Doing What Matters reads like a biography with lots of anecdotal stories to make it an entertaining and informative read. I'll sum up this review with my favorite quote from the book. "It takes guts to say these are the things that matter; I'll pay absolutely no attention to the rest. That's the challenge everyone faces. This book helps you meet that challenge." Enjoy!
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13 of 16 people found the following review helpful:
5.0 out of 5 stars
"Vision without execution is hallucination" (Thomas Edison), September 24, 2007
As I began to read this book, I was reminded of an observation by Peter Drucker in 1963: "There is surely nothing quite so useless as doing with great efficiency what should not be done at all." That observation should be kept in mind by those who assign work as well as those who are then expected to do it ("to do more and better work in less time and at a lower cost," etc.) With the assistance of John Manfredi and Robert Lorber, James Kilts has written a book in which he shares what he has learned from his business career thus far, especially from his years as CEO of Kraft, Nabisco, and Gillette. The book's title would even more accurately indicate his core business principles if it were "Do Well What Really Matters" or "Do Well What Matters Most" but the subtitle is just fine: "How to Get Results That Make a Difference - The Revolutionary Old School Approach." The inclusion of the word "revolutionary" is intentional and its appropriateness best revealed within Kilts's narrative.
In the city where I live, we have a number of outdoor markets at which slices of fresh fruit are offered as samples of the produce available. In that same spirit, I frequently include brief excerpts from a book to help those who red my review to get a "taste." Here is a representative selection of Kilts's insights from his years as a CEO:
"You not only have to sort out what you should pay attention to and what you should ignore, you must do so with [begin italics] revolutionary [end italics] speed and decisiveness. Yet, even with disaster staring them in the face, people from the lowest to the highest levels in many organizations often prefer to `rearrange the deck chairs.' They'll give lip service to stepping up performance, but in practice they go about business as usual." (Page 3)
"During my tenure at Kraft, we developed something called IMI - Integrated Marketing Intelligence - which gave us state-of-the-art insights into our brands, their categories, and consumer dynamics; how responsive they were to different forms of advertising and promotion; how much spending was optimal; and much more that will be explored later [in this book]. When we spent marketing dollars at Kraft, we were truly [begin italics] investing [end italics] in brand building." (Page 94)
"A company must function like a finely tuned engine of a racecar. It must not only have all the right components - injectors, valves, pistons, and the like - but each element must also be connected with all the others, and the timing and movement of all components must be absolutely in synch. Even the slightest miss in timing will result in poor performance." (Page 149)
"Many managers fail because they have a punch list of all the individual elements and when they see check marks against them, they assume the heavy lifting is over. Actually, the opposite is true. The heaviest lifting comes when all of the individual pieces are in place and you must make them work together to drive the company toward its objectives. At this point you need the right road map." (Pages 213-214)
Note: Kilts explains how to formulate such a "road map" in Chapter 11.
"Making the tough decision to fire someone, and doing it promptly, is something that I took to heart early on. Terminating someone is tough, but it doesn't get any easier if you put it off. Once you make the decision to fire someone, you start sending out signals, consciously or unconsciously, that are difficult to ignore. The intended employee's time on the job may be prolonged, but it will not be quality time, so say the least. If you level with someone, a termination or separation can be positive. Unless you are dealing with a bad actor, people lose their jobs because their position has become redundant or unnecessary, or because the person's individual skills are a mis-match for the position." (Page 288)
In the next to last chapter, "Politicians and Media Matter," the book's narrative sags somewhat as Kilts expresses his irritation with the Boston news media's coverage of the purchase of Gillette by Procter & Gamble, notably the Boston Globe's coverage that he characterizes as "piling on" big business and its leaders. In particular, he cites an op-ed article by Jack Falvey in which he shares a number of opinions about Gillette that were "unfounded and untrue." Kilts acknowledges the importance of the news media and concludes the chapter with some sound advice as to how to conduct effective press relations.
I agree with Kilts that "continuous dissatisfaction with the status quo is the best way to keep growing as an individual and an organization, or company." (Andrew Grove expresses essentially the same idea when explaining why "only the paranoid survive.") To me, the greatest strength of this book is its focus on real-world situations, especially those that involve a serious challenge, when it is imperative to determine what really matters (i.e. what is most important) and then concentrate on doing it well, thoroughly and consistently, to achieve the desired results, whatever those results may be. If some view this approach as being "old school" and obsolete, so be it.
Those who share my high regard for this book are urged to check out Noel M. Tichy and Warren G. Bennis' Judgment: How Winning Leaders Make Great Calls, Gary Hamel's The Future of Management, Ram Charan's Know-How: The 8 Skills That Separate People Who Perform from Those Who Don't, The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action and Hard Facts Dangerous Half-Truths and Total Nonsense: Profiting From Evidence-Based Management by Jeffrey Pfeffer and Robert I. Sutton, Pfeffer's What Were They Thinking?: Unconventional Wisdom About Management, and The Leader of the Future2 co-edited by Frances Hesselbein and Marshall Goldsmith.
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7 of 8 people found the following review helpful:
5.0 out of 5 stars
A Jump Start on Your MBA!, September 9, 2007
"Doing What Matters" is no substitute for a Harvard MBA; however, at only $16.50 it probably offers a better return on investment. Readers learn much about Kilts' thinking as he went about turning Gillette around; careful readers will also gain insight into the fact that not all turnarounds are created equal.
Kilts begins by relating how "quick screen" thinking helped him initially assess what to do with Duracell, a premium battery product line that only marginally fit into Gillette's other wares. Selling Duracell was one possibility - Kilts could have spent a lot of time and effort researching the possibility, distracting from other important issues. Instead, he simply observed that Gillette's relatively high P/E ratio meant Duracell was worth more to Gillette than anyone else. Another alternative was to simply "milk" Duracell - cut prices, and work it like a commodity. This didn't make sense either because consumers had a strong preference for Duracell and its formulation worked much better than regular zinc batteries. Thus, Kilts was quickly led to conclude that since Duracell was a category leader, Gillette needed to increase advertising (had been cut) and stop the rampant promotions and discounting.
Another major option reviewed through Kilts' quick screen was to strip everything down to shaving products - Gillette's core and most profitable business. This would reduce sales from $10 billion to $4, vs. the $48 billion at competitor Unilever and $70 at Nestle, and relegate the firm to minor player status vs. eg. $400 billion Wal-Mart.
Moving on, Kilts decided to take the Personal Care product line (shaving preparations, deodorants) out of Blades and Razors management because the Personal Care products required greater attention to detail and new product development.
Setting reasonable, but challenging and sustainable, goals is a major Kilts' concern. It's easy to temporarily boost profit and stock price through raising prices on brand leader products - however, this is not sustainable. Similarly, it is also easy to temporarily boost the stock price by declaring multiple-year double-digit revenue growth goals. This, however, is the path to what Kilts calls the "Circle of Doom," since only about 15% of companies that have done such succeeded doing such for five years. The more likely outcome involves building overhead and capital investment, followed by sales shortfalls, discounting (in an attempt to build volume - G.M., are your reading this?), then price increases (to recover revenue), cuts in marketing, and channel-stuffing (builds inventories throughout the system, end-of-month games, and drives production people nuts due to heightened peaks and troughs.
Three major (and early) decisions were to 1)severely reduce the number of products (SKUs), 2)set benchmarks throughout the company based on performance at leading competitors, and 3)commit to zero overhead growth (ZOG). Gillette recognized the need to cut SKUs prior to Kilts - a committee had been working on it for 18 months, but accomplished nothing (there were always counter-arguments). Kilts re-energized the group by telling them to come up with a 50% reduction list in one week, to be implemented within 3 months. (They actually cut 2/3 of Gillette's products, representing all of 2% of sales and a much greater proportion of headaches, in 9 months.) As for #2, everyone recognized the need to cut costs, but saw the problem as existing in other peoples' areas; Kilts' approach got things moving. (Kilts, however, did not tell us much about this benchmarking information was obtained, other than using a consulting firm to review IT, and instituting real-time reverse-bidding for suppliers on eg. PCs.) Area #3 included not only the obvious, but focusing on improved equipment utilization to eliminate the need for more.
Finally, Kilts offers one additional important tip - hit the ground running on Day One. Kilts did so via analyses of the firm's strengths and weaknesses prior to walking in the door; these findings were immediately and honestly (eg. the potential for layoffs) communicated at all levels, and the progress began.
A pretty good education for $16.50!
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